Finance Minister Arkhom Termpittayapaisith said a reduced tax on land and building could be reintroduced for at least two years.
Mr. Arkhom revealed that the Finance Ministry was considering a proposal to reintroduce the reduced land and building tax made to the ministry by the Joint Standing Committee on Commerce, Industry and Banking (JSCCIB), considered one of Thailand’s most important business trade groups.
According to Mr. Arkhom, the finance and interior ministries should discuss the proposal together since the latter is in charge of supervising the local administration offices that collect those taxes that could be reduced.
In addition, local government offices would lose revenue, which means that authorities would have to find funds from other sources to compensate them if the proposed measure is adopted, Mr. Arkhon added.
Thailand has already seen a reduction in land and construction tax. In 2021, the government authorized a 90% cut after another significant 50% reduction the year before.
Both measures were designed to mitigate the impact of the Covid-19 pandemic on the economy. Currently, however, land and buildings are subject to normal tax rates with some set reductions.
Under the plan proposed by the JSCCIB, land and buildings under development or those that have not been sold should be subject to the same reduced and lower tax as residential projects.
The group recommended the government impose reduced taxes on land and buildings from 2023 to 2024 in two phases with a step-up rate.
In 2023, the tax should be discounted by 75%, while the cut for 2024 should be 50%.
In addition, the JSCCIB said the Thai government should remove penalties for those who did not pay the tax in 2022 and allow them to make installment payments next year.
Land worth less than 50 million baht, owned by private individuals, and used for agricultural purposes is not subject to tax. Additionally, owners of buildings valued at less than 10 million baht are also exempted from the payment.